Good day, and welcome to the Ipsen's H1 2023 Results conference call. At this time, all participants are in listening-only mode. After the speaker's presentation, there will be a question-and-answer session, and to ask questions during the session, you'll need to press star one one on your telephone keypad, and you should hear an automated message advising you that your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand you over to your speaker of today, David Loew. Please go ahead.
Thank you, operator. Good afternoon or good morning, everyone. I'm delighted to welcome you to our H1 results presentation. As you just heard, I'm David Loew, Chief Executive Officer of Ipsen, and it's a pleasure to take you through our performance in the first half of the year. Please note that our presentation is available on ipsen.com. Please turn to slide 2. This is our safe harbor statement, which outlines the routine risks and uncertainties contained within this presentation. Also, any commentary on growth you'll hear today will be based on constant exchange rates, unless stated otherwise. Please turn to slide 3. For the presentation and for the Q&A, I'm joined today by our CFO, Aymeric Le Chatelier. Please turn to slide 4. Here is the agenda for today's call.
I will start our presentation with an overview of the business, after which Aymeric will take you through our financial performance, as well as our upgraded 2023 guidance. After concluding our presentation, we'll be happy to take your questions. Please turn to slide 5. Let's begin with the business overview. Please turn to slide 6. Today's headlines illustrate how we are continuing to deliver on the strategic roadmap. In the first half, we produced a total sales increase of 7.4%. Our growth platforms again delivered a double-digit performance led by Dysport and Cabometyx. These growth platforms, along with our newly acquired medicines, now represent around two-thirds of our top line. In the first half, we also delivered a solid core operating margin of 34%. We completed the acquisition of Albireo at the beginning of March, and the integration is progressing well.
On the pipeline, it was a productive period. The filing of the Onivyde sNDA in first line pancreatic ductal adenocarcinoma was accepted by the FDA, which also approved Bylvay in its second indication, Alagille syndrome. There was a favorable outcome from the FDA's advisory committee meeting regarding palovarotene in FOP, while at the end of June, we announced that the primary endpoint was met in elafibranor's phase III ELATIVE trial in second-line primary biliary cholangitis. Given Ipsen's performance in the first half, we are today upgrading our full year guidance on both total sales and the core operating margin. We now anticipate total sales growth greater than six in 2023, along with a core operating margin of over 30%. Please turn to slide 7. Our growth platforms are continuing to excel, outlining the gradual decline of Somatuline.
In the first half of the year, they grew by 18%, led by strong performances from Dysport and Cabometyx. Our newly acquired medicines also delivered meaningful contributions with Bylvay the standard. Somatuline, now at around a third of total sales, continues to decline gradually in line with expectations. I'll now take you through our sales performance in more details. Please turn to slide 8. Looking at our growth platforms in more detail, Dysport's momentum continues. Growth of 32% in the first half reflected a strong aesthetics performance by both Ipsen and our partner, as well as continued strong double-digit performance in therapeutics. As you know, there was a favorable supply comparison to that in H1 last year. We anticipate the opposite dynamic in the second half.
Cabometyx sales up by 26% were supported by strong volumes in Europe and the rest of the world, despite adverse price impacts, mainly in Germany. The growing contribution from the first line renal cell carcinoma combination with nivolumab continued, including the recent launch in Italy, where we have already achieved strong levels of total patient share. The Cabometyx combination is now reimbursed in over 20 markets. Decapeptyl grew in the first half by 6%. There was a particularly strong result in Q2, especially in rest of world, with China exiting the impacts of COVID. Growth in Europe was more subdued in the first half, however, partially impacted by adverse pricing. Finally, Onivyde continued to deliver strong underlying growth in the U.S.. North America sales increased by 19% in the first half as we continued to make market share gains under the current label.
We're now accelerating our pre-launch activities ahead of the regulatory decision in first line PDAC in the new year. Please turn to slide 9. Somatuline sales fell by 12% in the first half. This was further evidence of its gradual long-term decline profile, as illustrated by the chart you can see. In North America, sales fell by 10% in the first half. Volume demand and the market remained in solid growth, but pricing continued to be impacted by the level of commercial rebates and adverse movements in channel mix, driven by the increased effect of 340B. Europe, where sales declined by 22%, now represents less than one-third of Somatuline sales. Here, the volume and pricing impact from generic competition continues, though we do anticipate a slightly shallower, lower decline in Europe in the second half of the year, given the baseline effect.
Finally, in the rest of the world, solid underlying growth continued, with several geographies performing well, including Latin America. Please turn to slide 10. Turning to our recently acquired medicines, Bylvay has delivered a strong performance since we acquired Albireo at the beginning of March. Growth of 140% year-on-year reflected momentum in both North America and Europe. We continue to see an increasing number of patients treated for PFIC. Sales of Tazverik amounted to EUR 19 million in the first half, with commercial sales up by 18% year-on-year. As you know, relaunching a medicine takes time. Tazverik sales in the U.S. will therefore see a gradual increase as we are repositioning the medicine in all comers and for elderly, unfit patients in the office-based setting, which has not been the case before, and where we now see increasing sales. Please turn to slide 11.
Turning now to the major elements of our pipeline, there were a number of favorable developments in the first half of the year. The FDA accepted the filing of Onivyde, NALIRIFOX regimen in first line PDAC, and approved Bylvay for the treatment of cholestatic pruritus in patients from 12 months of age with Alagille syndrome. The FDA's Endocrinologic and Metabolic Drugs Advisory Committee also voted in favor of palovarotene as an effective treatment for people living with FOP. Positive top-line data from the pivotal ELATIVE phase III trial of elafibranor in second line primary biliary cholangitis were published at the end of last month. The trial met its primary endpoint, full data from the trial will be presented in due course. We plan to add more patients to the phase III Bylvay BOLD trial in biliary atresia to maximize the probability of success.
We estimate the readout in around 2026. Please turn to slide 12. We have plenty more pipeline news flow in the coming months, including several potential regulatory approvals. Following the outcome of the advisory committee meeting I just mentioned, we anticipate a regulatory decision in the U.S. on August 16 for palovarotene and FOP. We also continue to expect phase III data this year in respect of Cabometyx plus atezolizumab in second-line metastatic, castrate-resistant prostate cancer. Given the recent use of a positive CHMP opinion for Bylvay in Alagille syndrome, but the negative COMP opinion on orphan drug maintenance, we anticipate a delay to the regulatory decision. Following the publication of top-level results from the phase III ELATIVE trial, we plan to file for elafibranor in the United States and Europe by the end of the year in second-line primary biliary cholangitis.
Finally, a decision by the FDA on Onivyde is anticipated in mid-February. I'll now hand over to Aymeric. Please turn to slide 13.
Thanks, David. Hello, everyone. Please turn to slide 14. Our financial results in the first half of the year reflects sustained top-line improvement, investment for growth, and a solid cash flow generation. Total sales increased by 7.4% at constant exchange rate, as presented by David. A solid core operating margin at 34% of total sales, a decline of 5.6 percentage points, mainly reflecting investment for growth, fueled by the recent acquisition of Epizyme and Albireo. Note that Albireo was consolidated in 2023 for four months, since March. We have also a core EPS declining by 6.6% to EUR 4.73 per share. This is in line with the evolution of the core operating income and the free cash flow increasing by 10%. I will come back to that. Please turn to slide 15.
Looking at the detail of the core P&L performance, the growth in total sales at 7.2% was marginally impacted by the evolution of currency in the first semester. The gross margin ratio improved by 0.5 percentage points to 88.1% of sales, benefiting of higher other revenue from an upfront related to the granting of license rights to Onivyde in the first-line PDAC indication from our ex-U.S. partner, which has offset the increase of cost of goods driven by adverse mix in royalty paid. R&D costs increased by 40% to reach a ratio of almost 19% of total sales, in line with our ambition to invest more in our pipeline, including the asset from the acquisition of Epizyme and Albireo.
SG&A costs increased by 13%, with the ratio reaching 36% of sales, reflecting the commercial investment to support growth, as well as several launches, including Tazverik in the U.S. and Bylvay in the PFIC indication in the U.S. and in Europe. core operating income declined by 7.9% to reach EUR 523 million. Please turn to slide 16. Looking more in detail at the dynamic of the core operating margin, you can see the component of its evolution in the first half versus the record level reached in H1 2022 of 39.6% of sales.
First off, base business was almost flat in margin, driven by the strong momentum of the growth platform, and despite the gradual decline of Somatuline and the level of investment to support pre-launch activity and the investment to support our growth in the rest of the world markets. Secondly, the dilutive impact of 7.6 percentage points is coming from the acquisition of Epizyme and Albireo. This is fully aligned with our expectation, with more synergies to be realized from H2, 2023. Thirdly, the positive impact on group margin in H1 of 2.1 points of the Onivyde license rights upon from our ex-U.S. partner for the first time PDAC indication outside the U.S.. Lastly, you know that the currency evolution had also a minor favorable impact on the profitability.
As a consequence, Ipsen maintained a strong level of profitability in H1 with a core operating margin at 34% of sales. Please turn to slide 17. Turning to core operating income to consolidated net profit, I wanted to highlight several movements. There was a significant increase in the amortization of intangible assets from EUR 46 million to EUR 91 million, mainly related to the new IP assets recognized for Bylvay and Tazverik. Restructuring and other operating expenses for EUR 125 million, mainly impacted by the integration and transaction costs related to Albireo and Epizyme acquisition, but also the transformation program within Ipsen and the discontinuation of clinical trials.
As a consequence, after a lower level of income tax, IFRS consolidated net profit declined by more than 50%, while the core EPS only decreased by 6.6% with an effective tax rate at 20.4%. Please turn to slide 18. We continue to deliver strong cash flow generation and maintain a very robust balance sheet after the acquisition of Albireo. As you can see, free cash flow grew by 10% to EUR 317 million, benefiting from sound management of working capital and CapEx, despite higher restructuring costs from the Epizyme and Albireo acquisition and lower EBITDA in line with our core operating income. Net debt at the end of June amount to EUR 272 million, after the payment of dividend for EUR 100 million and the acquisition of Albireo for almost EUR 1 billion.
As a consequence of firepower for external innovation transaction, which remains our capital allocation priority, has increased to EUR 1 billion at the end of June 2023, based on the guidance of two times net debt to EBITDA. Please turn to slide 19. Based on this strong momentum, we are now upgrading our full year guidance for 2023, as David Loew said in the introduction. We are now expecting total sales to increase by more than 6% at constant exchange rate this year. Our growth platform are set to continue performing well, and we will have further contribution from Tazverik and Bylvay in the second half of the year. Note that we now assume a 3% headwind from currency based on the average level of exchange rate in the month of June, as compared to two points before.
We anticipate also a higher level of core operating margin at over 30% of total sales. We will continue to see the dilutive impact from the acquisition of Epizyme and Albireo, mitigated by the ramp-up of cost synergy and higher sales. In H2, we expect also an increase in R&D investment and an increase in our commercial investment to support the potential launch of new indication and line of therapy, including elafibranor, Onivyde, Bylvay, and palovarotene. Note that this guidance does not assume any incremental external innovation transaction in H2. Thank you very much. I will now hand back to David. Please turn to slide 20.
Thank you, Aymeric. Please turn to slide 21. Before we go to questions, please let me conclude. The ongoing execution of our strategic roadmap is consistently driving our growth story. The progress we are making means that we're continuing to deliver strong results. Our growth platforms are performing well, and we are seeing the benefits of our external innovation strategy adding to the top line. Despite the significant investments in growth, we've produced a strong core operating margin in the first half, while further cash generation is supporting a robust balance sheet underpinning our external innovation ambitions. The pipeline is also progressing nicely, with several programs added this year, accompanied by a number of favorable developments.
We look forward to sharing further pipeline news flow with you in the coming months, give you more details on Ipsen's growth journey at an anticipated capital market stay in London on seventh of December. Please turn to slide 22. Thank you for listening to our presentation. We now have time for your questions. Operator, over to you.
Thank you. As a reminder, to ask questions, you'll need to press star one one on your telephone keypad and wait for your name to be announced. To withdraw your question, press star one one again. We're now gonna go to our first question. The first question is coming from the line of Brian Bolton from Jefferies. Your line is open, please go ahead.
Hey, yeah, thanks for the question. First one, just thinking about full year core operating margin, should we be expecting any more license income from Servier this year? Just how should we be thinking about cost saving in the second half, presumably step up? Second on elafibranor, does your $500 million peak sales guide bake in competition from seladelpar? Just given that we get phase III about this Q, and it already looks quite de-risked. If it does bake in, do you think you could help us with your assumptions there? Just trying to get a sense of potential upside and downside. Thank you.
Okay. We start with Aymeric on the first two parts, the full year COI and the cost savings, and then I will answer on elafibranor.
Yeah. Regarding your questions, as you've seen, I mean, the first half was impacted by this milestone received from Servier. Under the agreement that we signed, and I can give you all the details, there are additional milestones. We don't know exactly what will be the timing of those milestones, we have factored on a risk-adjusted basis, some limited, but the biggest one has been booked in H1. Regarding cost savings, yes, we continue to deliver consistently on our efficiency program, we should continue to see impact of the efficiency program in H2. I think the more important will be the ramp-up of synergy that we expect also from the integration of both Epizyme and Albireo.
As you remember, our guidance was more on a 12 - 18 months timeline, so we will start to get some of the savings from Epizyme on the second half, and this is more in 2024, but we should get most of the synergies on the cost base to be materialized.
Regarding your third question on elafibranor with the EUR 500 million guidance. Of course, we have taken into account, you know, the data that we have seen so far, including competition. That means now that we're waiting for the seladelpar data, and, you know, we have to really, really see the details to be then in a position probably post AASLD, which is happening in November, to provide you updated guidance. We will come back with guidance and, you know, in regards to upsides or downsides, we can really then only comment at that time point. Next question.
Thank you for your question. We're now gonna move on to the next question. Just transferring now. The next question comes from the line of Alistair Campbell, from Royal Bank of Canada. Your line is open. Please go ahead.
Hi there. I hope you can hear me. Just had a couple, if I may. First of all, on fidrisertib, now that palovarotene looks very likely to get approved in the U.S., does that have impact on the fidrisertib development program? Will it need... You know, what do you hope to see if you sort of look at fidrisertib versus palovarotene? Will you even have to consider head-to-head trials in terms of profiling that product appropriately? Then maybe I'll just chance my arm on the core EBIT and take it a bit further.
I know we're too early for guidance for 2024, but as we look at sort of how things are evolving, costs stepping up in H2 this year, you still have to fully annualize the impact of the Albireo acquisition going into 2024. Can you maybe give a hint as to the broad trajectory for the core EBIT margin in 2024? Is it kind of down, neutral, up? Thanks.
Thank you, Alistair. I will take the first, and Aymeric, the second question. On fidrisertib, you know, fidrisertib, we are now in the pivotal trial, we have to wait for the readouts. fidrisertib has a somewhat different profile than palovarotene, we will have to see once we see the full data, how we are gonna position the drug. It's too early to speculate about, you know, head-to-head or combinations, et cetera. We really have to cross that bridge when we have seen the full data of the readout of the pivotal study. Core EBITDA 2024?
Thank you for the question. As you indicated in your question, we're not gonna provide a guidance for 2024, but maybe just to help you on, on some of the elements, you're right to say that there will be two additional months for Albireo as we consolidated, only starting from March. You have to take into consideration, as I said, that there will be increasing level of synergy, there will be increasing level of sales for the two acquisition. As we said, when we announced the two deals, those two deals, it will take two years to break even from a margin and core operating income contribution. We see less dilution, more synergy, more top line towards 2024.
While at the same time, we are also investing, and I said about elafibranor and Onivyde being the two biggest investments, and we expect also to start getting some sales in additional sales in 2024. These are elements to guide on the margin. As you know, also, the Servier milestone, that was a question before, is not gonna be recurring, and we have also some ethics impact as we talk about it in the updated guidance.
Very well. Thank you.
Thank you very much for your question. We're now gonna move on to our next question in the line. Our next question comes from Manos Mastorakis from Deutsche Bank. Your line is open. Please go ahead.
Hello, thank you for taking my question. First question was, if you could give a bit of color on the guidance increase and what to expect in terms of the sales mix in H2, because you alluded to Dysport potentially reversing the trend that we've seen in H1. You know, if you can tell us which products are most likely to drive most of that guidance increase. Also, you've had a string of positive events recently and just wondering how has that changed your overall corporate strategy and appetite for further BD and M&A? Thank you.
Okay. Aymeric is going to answer on the first one. I will take the second one.
Regarding your comment on the top line growth, as you know, we deliver 7% in the first half. We're guiding for greater than 6%, so we see a similar profile in the second half of the year. You're right to point out that the breakdown by product is gonna be slightly different, mainly on Dysport, where the baseline was very low in H1, which explained to some extent, as David pointed out, the strong performance in H1. We still see a very dynamic market for Dysport, but clearly the baseline not only was pretty low in H1, but there were catch up last year in H2, so the baseline is gonna be higher.
On the other way, we see increasing contribution from the newly acquired product, Bylvay and Tazverik, and we see also some further growth for Onivyde and normalization for ex-U.S. sales of Onivyde. You've seen they were negative this semester, due mainly to the ex-U.S. contribution. We see that to normalize in the second half of the year. I hope it will help you to guide by product, the view by the end of the year.
On your second question regarding the positive events, you're right. We were very happy to have those, so that bodes well for future growth and accelerating our, you know, external innovation add-ons that we have. Also our underlying base business with the growth platforms, for example, on Onivyde, or of course, also with the new products on Alagille that we're gonna launch and elafibranor, so that's very exciting. In terms of future BD, that's not gonna change. We still want to continue to fill the pipeline. We are gonna be active on the external innovation. You have seen that we're building up very rapidly, again, our firepower, even after the acquisition of Albireo. We have a strong cash generation.
Yes, we're gonna, you know, license or acquire potentially more medicines, also in the future. That's our model, we're gonna continue to execute on it.
Thank you.
Next question.
Thank you for your question. We're now going to move on to our next question in line. Transferring now. The next question comes from Delphine Lhuillier, from Société Générale. Your line is open, please go ahead.
Thank you. Good afternoon, everyone. Three on my side, if I may. Looking at Somatuline loss over the semester, which was roughly EUR 70 million in revenue, and the base business being up EUR 140 million. When I look at your slide 16 and looking at the base business contribution to the COI, can we think that it's effectively the break-even point in term of balance in between the base business and Somatuline and this is a way to look a bit further for the margin and for the margin dilution in the future. Second question is the ones on DCAP and Cabo. DCAP, how should we think about the Chinese business right now?
Can you give us a bit of a granularity regarding the reordering of other quarter, plus, any news on the pricing? Can you also detail why Germany is weak? Secondly, regarding Cabo, can you share the breakup in between the first and the second line? Can you give us some indication looking forward regarding the growth or the market share, whatever. Thank you.
Thank you, Delphine. Aymeric is gonna take the Somatuline question. I will take up afterline Cabo.
If I understand correctly, your question is, today we are showing that the base business is flat in margin, which means that we are able to compensate the gradual decline of Somatuline, which, as you know, is a highly profitable product by the contribution of our growth platforms in the semester. I think it is right to say that going forward, Somatuline, which now is only 1/3 of our total sales, the weight of Somatuline is gonna decline, and we see that the growth platform will continue to contribute. We believe that we should be able to maintain the profitability as we have been doing over this semester, of all the business, and be able to add progressively the contribution and the margin improvement of the new product.
Managing also the launch and investments of additional new products, elafibranor being one of them.
on your, or do you want to add something?
No, no, absolutely not. No, thank you. Very clear. Thanks.
Okay. On Decapeptyl, China, as you know, this is an attractive piece to our business, reflecting about roughly 20% of our sales. We are going to launch the six months formulation where we are differentiated. Now, in terms of pricing, there have been the submission of some new products, they have not been submitted really as a generic pathway. It's unlikely that this is going to result in a volume-based procurement, because they are, A., mostly on the one-month formulation, the market is very rapidly moving to three months, in the future, we will push it also to six months because it's much more convenient and easier on the healthcare system.
You know, we are positive on Decapeptyl in China, and we are positive for Decapeptyl overall, as generally, because we think it's really the backbone of therapy in prostate cancer. Hormonal therapies are being given, and we see longer and longer treatment duration and more demographics push with more elderly men coming in. Germany, I mean, let Aymeric, perhaps, say a word to Germany.
Germany on Decapeptyl, I think this was a very minor impact. What we wanted to highlight is that all the geography are growing in volume except Germany, for very specific, just as a reminder, Germany is less than 5% of the sales of Decapeptyl.
On Cabometyx, the split of first and second line is roughly 1/3 first, 2/3 second line. You're going to see this change. The first line is growing much faster than the second line. The dynamic is the following: we're still launching second line in some of the emerging markets. On top of that, we have started to launch beyond the leadership position that we already have in second line in most of the Western markets. We have started to launch in the first line indication in several markets like Germany, France, Italy very recently. The pool of patients in the first line is at least 50% bigger, and the treatment duration is also roughly 50% longer.
When you add that together, it means that in every market where you launch first line, and we have now launched it in 20 markets around the world, first line, there will be a much higher share of the sales coming from that first line indication. The market share are developing quite nicely, so we have roughly 20% of the first line, and we hope to grow this further.
Many thanks.
Next question.
Thank you for your question. We're now going to move on to the next question. Transferring now. The next question comes from Charlie Haywood, from Bank of America. Your line is open. Please go ahead.
Charlie Haywood, Bank of America, on behalf of [inaudible]. Thanks for taking my questions. I have two, please. Firstly, on your Bylvay ongoing launch, you had $18 million sales in the quarter versus $5 million sales in March, which was slightly more modest growth than the apparent 1st quarter uptick. Firstly, can you talk about your penetration into the PFIC market and your current share in market dynamics versus LIVMARLI launching recently? Secondly, how are you thinking about your Alagille syndrome launch with LIVMARLI already well penetrated and seemingly like little differentiated on FC? Second question, please, on your recent elafibranor data, how compelling do you view the overall data profile? How important do you see the lack of statistically significant pruritus versus imminent seladelpar or seladelpar competition that could demonstrate statistical significance on pruritus? Thank you.
Thank you. It was a little bit hard to hear you. Your line is not very good, but if I understood it right, your question was, Bylvay first quarter five, second quarter, total 18, and then the penetration in PFIC. We are penetrating relatively well in PFIC, but there is much more to go. We are not giving out market share yet. We have heard regarding your question on ALGS, we believe that Mirum Pharmaceuticals has about 20% market share in ALGS, there is plenty of space where Bylvay can now take market share. Of course, you know, some patients are also not going to tolerate the drug or they will have a strong preference for the galenic formulation, which is, in our view, easier to take.
We hope that we're going to get significant market share also in Alagille. We assume that Bylvay is going to continue to grow very strongly. Regarding your second question on elafibranor, how compelling is the data? Well, first of all, we have to be super careful on cross-study comparisons. I mean, as you know, we passed phase III, all LIVMARLI was stopped. They have reinitiated a new trial. Some of the endpoints are very early, like cholestatic pruritus has been measured, for example, at three months. We have data at 12 months, you need to be very careful. You also have to look very carefully at the underlying demographics, where differences can play a very important role.
We can't really say how compelling our data is versus with Marley, because we clearly need to see their results and not just the press release, but we actually need to see the results in detail. If they stick to what they have told the market that they are going to publish in Q3, that would mean they could have a late breaker, potentially for AASLD, if their data is compelling, and we're going to therefore potentially see the data at AASLD. That's when we really can tell you the answer to your question. The lack of pruritus, as I said, you can't compare it to LIVMARLI because they measured at three months, we measured at 12 months.
The fact that the trial was positive on the primary endpoint and the first secondary endpoint, you know, which are the outcomes, is of course, really very important. We are delighted about that because these patients are in a dire need of new solutions. Of course, on pruritus, and we would have loved to hit this one as well, but there was a trend, and we just didn't quite achieve statistical significance.
Okay, thank you. Thank you very much for your question. We're now going to move on to the next question in the line. The next question comes from Richard Vosser from JPMorgan. Your line is open. Please, go ahead.
Hi there, Richard Vosser, JP Morgan. Thank you for taking my questions. Just two from our side. The first one on Bylvay. Q2 looks strong. Was there any contribution from Alagille syndrome at all here, or is this all PFIC? Obviously, just also thinking about the positive CHMP, but the negative COMP opinion for Alagille syndrome in Europe. How important is the orphan drug designation to approval and also exclusivity? What are the potential implications if it was approved without orphan drug designation? Just trying to think about the dynamics relative to LIVMARLI, which is obviously already approved here. Then the second question on Dysport. We're just trying to understand how much capacity you have, really, in terms of continuing to service the strong growth we've seen ex-U.S.
Maybe just any more commentary about what was leading to the potential weakness in the U.S.?
On Bylvay, the sales that we have seen really come from PFIC. There is no Alagille contribution yet, because we have just gotten the approval in the United States end of June. To your second question on Bylvay regarding the positive CHMP, we're of course, delighted because they see the benefits of the drug. It's clearly an approvable drug. There is, of course, the negative opinion of the COMP regarding the orphan drug status. You know, the question is, how important is actually orphan drug status? Orphan drug status has three points to consider. The first one is you get a faster review, typically by regulatory authorities. In a way, that's water under the bridge because we now got the positive opinion of CHMP.
The first point becomes kind of irrelevant. The second one is, it can confer to you an additional protection from generics, if you would have a short substance patent. Our substance patent is actually fairly long. It goes until July 2036, at least, and potentially longer. The orphan designation protection would come as a supplement to the base patent, it is actually slightly shorter than the substance patent. Therefore, you know, it has a certain importance, but, you know, we have optionalities there. We still felt we wanted to appeal, and that appeal process is actually fairly short, we should see an approval by the end of this year. Regarding your second question on Dysport capacity, we have enough capacity now.
As you know, we have upgraded our capacity. We will still further add capacity because we believe that the neurotoxin franchise is a very attractive franchise for us in aesthetics and in the treatment space. We are continuing to invest, and as we speak, we're actually starting with the construction of an additional building, that's really for the long-term forecast on our neurotoxin franchise. Your question on weakness in the U.S.. What we think is happening is that the U.S. market is softening a bit, it remains to be seen, you know, how persistent that is gonna be. Next question?
That's great. Thank you.
Thank you very much for your question. We're now gonna move on to the next question in the line. Our next question comes from Sachin Jain, from UBS. Your line is open. Please go ahead.
Hi. I've just had a couple of questions. First, on Tazverik, I was just wondering when you think you'll start to show a change in momentum, and when you think things are, your strategy is going to help it to start picking up? The second question was on palovarotene and your thoughts after the AdCom, and your level of confidence in that the FDA will follow the AdCom recommendation, given some of the behavior so far.
On your first question, thank you, Sachin, you know, we are starting to see the first markers of uptake in the new positioning. You need to remember, Epizyme has positioned this in the academic centers in mutant patients. What's happening there is we knew that the bispecifics are coming in there and also the CAR T. It is clear that we're potentially going to lose a little bit of sales in the academic, and that is what is playing out. At the same time, we're starting to see a pickup in the office-based physicians because that's where the elderly, frail, slower progression patients are. There, indeed, we started to see a faster uptake since we have deployed our field force, which before was not really the case.
These two effects are playing out against each other, and that's why you see the 18% growth rate. It's going to be kind of a bit of a slow burn, a gradual increase that Tazverik is going to have. Of course, you're going to have a potentially much bigger step once we get the second line indication trial, read out and registered. Regarding palovarotene, you have seen 11 votes were in favor out of 14. Usually, the FDA is following that recommendation, and the interactions with FDA are going according to plan.
Thanks.
Thank you.
Thank you very much for your question. We're now going to move on to our final question of the day. Answering now. The final question comes from Levon Demirdjian from Redburn. Your line is open. Please go ahead.
Yes, hi. Hi, thank you for taking my question. Two quick ones, if I may. First one, can you give us a bit more granularities on the, on the second half margin push and pulls? Can you give us your thoughts on the scope for broadening the potential for recently approved assets like Tazverik in solid tumors or Albireo's early pipeline, like A3907?
Yeah. Aymeric is going to answer you on the first one. I'm going to answer you on the second one.
Regarding the margin for the second half, as you see, we deliver 34% in the first half. We're guiding for above 30% for the full year. Even if you adjust for the one-off from the Servier milestone, there is clearly a lower margin in H2, which will be driven not that much by the top line, as I explained before, as we anticipate a similar top line. It's more related to two elements. It will be additional investment, mainly in R&D, but also commercially to prepare for some of the launch, and in R&D to support, especially the ongoing study that are being launched, post positive data for elafibranor.
Also we'll have some negative impact of the FX as we anticipate a significant impact of FX in the second half of the year.
To your second question regarding potential broadening of Tazverik, but also the other compounds from Albireo that we have in the pipeline. I'll start with Tazverik. In solid tumors, we have a trial ongoing in prostate cancer that is in phase II in combination with hormone therapy. You have all the details of the trial in the attachment of the slides. We have to just wait for data to then take a decision, okay, where are we going to take it from there? We also have on Albireo, on the IPN60250, formerly called the A3907, a trial ongoing in phase II in primary sclerosing cholangitis. Again, we need to wait for the phase II data. Again, you have the details in the attachment.
The same is true for the formerly called A2342 compound, which is now IPN60260 in viral cholestatic disease. That's actually hepatitis D, often in combination with B. Again, we need to see what the phase 1 results are going to show before we can determine, you know, where we are going to take these drugs, or we are going to accelerating, slow down, stop, et cetera. We need to really wait for the data there. With this, that concludes our call. Thank you very much for everybody, for having attendance. Bye-bye.
Bye.